HP Shows 14% Hike In Net Profits For 3Q

Hewlett-Packard Co., once again has beaten all odds and belied analyst speculations, reporting a 14% hike in its 3Q profits and the net income at $2.03 billion.

With sleek designing and a considerable overseas demand HP, the No.1 name in PC makers has reached the $28 billion mark in quarterly sales, a 10% rise than the past quarter.

The news of its third quarter results led to a 4.4 % rise in share prices, giving HP an 86 cents profit per share, again beating the analysts’ expectations of 84 cents.

Having beaten Dell in the PC market two years back, it was the introduction of metallic body and a more sleeker look to the notebooks that played the trick for HP this time round and gave the Computer sales their much applauded 15 percent boost., all to the credit of CEO, Mark Hurd.

``It's the broadness of their portfolio and international mix that allows them to do better than Dell,'' said Shaw Wu, an analyst at American Technology Research in San Francisco. ``These results are quite strong.''

The gains in overseas markets were tremendous this quarter, with a 24% increase in revenue in countries like Brazil, Russia, India and China. In California also, where until now, the shares had dipped 135 since year beginning, there was a $1.91 rise to $45.60 at NYSE.

The overseas revenue contributed to two third of the sales. With a rise of 4% in the sales in America, 14% in Asia Pacific and the maximum of 16% rise in sales from Europe, Middle East and Africa.

``You've got a lot of places around the planet where the only access to the digital content out there is through a notebook and a wireless card,'' Hurd, 51, said on a conference call with reporters.

Hurd who has as a track record always beaten analysts’ profit estimates in every quarter, considers this to be a significant opportunity for HP. He took over HP in April 2005.

As of this quarter, HP’s PC shipments world over are a whopping 19% as compared to the 16% Dell’s share. However, at a 21% increase in worldwide PC shipments, Dell has managed to surpass HP’s growth rates twice, in the first as well as second quarter.

Nevertheless, Hp shot back with a 20% increase in shipments in the third quarter, bringing its notebook revenue at a 26% increase as compared to last year and the Desktop revenue is also up by 6%.

Here’s an overview of some of the other performers of HP –
• Printer and supplies sales increased by 3.4% to stand at $7 billion this quarter.
• Software sales rose by 29% and stand at $781 million.
• Another $6 billion would be pumped into the software arena by Hp.
• Revenue from consulting and outsourcing services rose 145 and stands at $4.75 billion.

With dell fast gaining in the customer satisfaction arena, and plans of expansion already underway for HP in the software section, there is actually no looking back now. Tough competition and tougher standards to live up to are what keep the company going.